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2021 Week 26 investing and trading report

June 2021 is over. It was a good month trading stock options, although not the best month. The Net-liq of the account increased a little (only +6.73%) compared to double-digit growths in the previous months. Our options income grew above the average so I am happy about it. In this investing and trading report, we will once again present the results of our dividend growth investing and options trading.
 

Our investing and trading rules

 
Once again, we would like to remind you of our rules when trading and investing in our portfolio, or investment fund. It is important to know what rules and what kind of trading we engage in. In this case, you will understand our results and our trades as they will be put into a perspective.

For example, a scalper, or a swing trader has different rules and takes different trades than a long-term investor. So you need to know what we trade.

 

6 Rules of our trading

 

  1. We do NOT trade stocks, we do not look to sell our stock positions.

  2. Our positions are our stock rental properties.

  3. We consistently use our stock rental properties to generate income.

  4. We do not stress over our positions going up or down.

  5. We use the income generated for living expenses or it can be reinvested into new assets.

  6. Trading should be fun but it is also a business.

 

With these rules, we can invest and trade options without fear of losing or fear of having a trade that is going against us. We have a long-term INVESTOR mentality. And that gives us peace of mind. I said that many times. Even as a trader, you still have to think, act, and be an investor. Many people start trading because they want to be traders. But then, they take a trade that goes against them and they decided to be investors. They end up sitting on a bad trade and think that one day, they will be able to go out. They are now involuntary investors.

And now, let’s go and review this week’s investing and trading.

 

Here is our investing and trading report:

 

Account Value: $73,475.23 $1,086.34 +1.50%
Options trading results
Options Premiums Received: $716.00    
01 January 2021 Options: $4,209.00 +16.65%  
02 February 2021 Options: $4,884.00 +15.41%  
03 March 2021 Options: $5,258.00 +12.79%  
04 April 2021 Options: $2,336.00 +4.30%  
05 May 2021 Options: $6,346.00 +9.22%  
05 June 2021 Options: $4,677.00 +6.37%  
Options Premiums YTD: $28,384.00 +38.63%  
Dividend income results
Dividends Received: $26.43    
01 January 2021 Dividends: $53.04    
02 February 2021 Dividends: $63.00    
03 March 2021 Dividends: $30.31    
04 April 2021 Dividends: $139.70    
05 May 2021 Dividends: $167.45    
06 June 2021 Dividends: $168.56    
Dividends YTD: $709.64    
Portfolio metrics
Portfolio Yield: 4.60%    
Portfolio Dividend Growth: 8.44%    
Ann. Div Income & YOC in 10 yrs: $16,467.77 19.00%  
Ann. Div Income & YOC in 20 yrs: $152,946.95 176.50%  
Ann. Div Income & YOC in 25 yrs: $771,976.83 890.84%  
Ann. Div Income & YOC in 30 yrs: $6,491,300.24 7,490.78%  
Portfolio Alpha: 31.06%    
Portfolio Weighted Beta: 0.73    
CAGR: 774.18%    
AROC: 30.02%    
TROC: 21.01%    
Our 2021 Goal
2021 Dividend Goal: $1,071.42 66.23%  
2021 Portfolio Value Goal: $42,344.06 173.52% Accomplished

 

Dividend Investing and Trading Report

 
Last week, we have received a $26.43 dividends income. We feel that the income will be growing faster as more of our holdings mature and become eligible for dividend payouts. According to our holdings currently on our balance sheet, all stocks should generate $3,783.70 annual dividend income. It is not as of yet because many of the stocks were purchased recently and we missed their dividend. But next year, we should be receiving the full amount.

The chart below indicates our current annual dividend payout from our dividend stock holdings.

Last week, our dividend income reached 66.23% of our dividend income goal.

 
Annual Dividend Payout week 26
 

Options Investing and Trading Report

 
Last week we again rolled a few trades to release a stressed buying power in our account. In about a mid-week, our account started showing more growth of BP and we were able to re-open one last trade that was still pending as “to be reopened”.

What does that mean?

For the first half of the year, I was scaling up my trades. When the account, buying power, and cash grew, I was adding more and more new trades. For the second half of this year, I decided to not scale up the trades and trade only what I am trading up to today. So I set rules for the rest of the year to only reopen trades that expired or were closed, and roll existing trades. But no new trades that would require more BP.

Based on the rule described above, I opened a new trade against MU only. Now I am fully invested and I will be reopening expired trades only.

Last week, no trade had an expiration day.

The new trades and adjustments delivered $716.00 options premiums last week.
 

You can watch all our trades in this spreadsheet and you can also subscribe to our newsletter for our trade alerts.
 

Expected Future Dividend Income

 
As the table at the beginning of this report indicates, our aggressive dividend growth stocks accumulation is starting to show significant progress in our future dividends income. Our portfolio dividend yield and dividend growth will be bringing us almost $152,946.95 in 20 years and $6,491,300.24 in 30 years. I wish, I had that $6 million income now. But that is the fate of dividend growth investing. It is not a quick rich scheme and building an account takes time.

We will keep aggressively accumulating dividend growth stocks to generate liveable income sooner than in 20 years. And the portfolio is starting to show this to be happening. In just 10 years, we will start receiving $16,467.77 in today’s dollars. It is not bad considering that in March 2021 it was only $3,202.52 in projected future dividends.

 
Future Divi on YOC week 26
 

The chart above shows how our future dividend income based on the future yield on cost and what dividend income we may expect in the future. The expected dividend growth depends on what stocks we are adding to our portfolio and the stocks’ 3 years average dividend growth rate. It is interesting to see what passive income we may enjoy 10, 20, 25, or 30 years from now.

 

Market value of our holdings

 
Our non-adjusted stock holdings market value increased from $88,163.26 to $92,291.19. Last week, we added a few stock positions to our portfolio, such as 10 shares of VICI, 15 shares of ICSH, 10 shares of PMT, and 23 shares of ABBV.

With the addition of 23 shares of ABBV, we finished accumulating this stock. We now hold 100 shares of ABBV. We will proceed to accumulate other shares. Our immediate candidate for more accumulation is VICI Properties Inc. (VICI).

 
Stock holdings week 26
 

Our goal is to accumulate 100 shares of each stock of our interest and we are getting to that goal.
 

Investing and trading ROI

 

Our options trading delivered a 6.37% monthly ROI in June 2021, totaling a 38.63% ROI YTD. We are getting close to our 45% mark!

Our account grew by 257.16% this year despite very slow growth in June. I suggest the growth was suppressed by the market volatility and options trades increasing their maintenance requirements that ate the net-liq value. Once the options expire (hopefully) the net liquidating value will go up faster.
 

Our options trading averaged $4,054.86 per month this year. If this trend continues, we are on track to make $48,658.29 trading options in 2021. With the income of $28,384.00 to date, we are half way to this projected income.
 

Old SPX trades repair

 

This week, we rolled one old SPX trade away, keeping the bad dream going. But I am thinking to let it go. There are traders out there that roll their trades for years until they finally work in their favor. I might be doing the same thing here until I will grow our account enough to get rid of an Iron Condor and switch to a strangle. With a strangle, I have a lot better chance to adjust the trade successfully. But a strangle against SPX is capital expensive trade. It will require a lot of margin. And the only way how to reduce the margin is to be able to trade with a portfolio margin. For now, I will keep it on and decide later.

 

Accumulating Growth Stocks

 

Last week, we didn’t add any speculative or growth stocks to our portfolio. But, we will be adding SNOW and TSLA to reach 100 shares.

 

Accumulating Dividend Growth Stocks

 

Last week, we added 15 shares of ICSH (which is our savings account equivalent), 10 shares of VICI, 10 shares of PMT, and 23 shares of ABBV to our portfolio. We have reached our goal to accumulate 100 shares of ABBV.

VICI is a new company. It is a REIT that invests in properties in Las Vegas like Caesars Palace. They do not own and operate the hotel itself, but they own the building and rent it to the hotel owner. Unlike many businesses, they were not impacted by covid-19 (the stock was because investors were freaking out about the business but the fears never materialized). The company was getting paid the rent every single month during the pandemic. And once investors realized that VICI was not impacted, the stock recovered extremely quickly.

The company has very good growth potential and its expected earnings are estimated to grow by 10% year over year. Currently, the stock is greatly undervalued at the current price of $31.09 (my calculated intrinsic value is $96.21 for 2021 and $101.63 for 2022. So, I will be accumulating at these levels aggressively.

The company pays dividends, currently yielding 4.25% and they have been increasing the dividend since 2017. The management appears to be investors friendly and they plan on paying and increasing dividends in the future.

And lastly, if you go to Vegas these days, you will experience enormous visitations by tourists. Vegas is packed! Streets are full of people and restaurants are booked three to four weeks ahead. Yes, you read it correctly, three to four weeks ahead. I believe, VICI is a good way to get a share of this recovery frenzy.

Our goal is to reach 100 shares of high-quality dividend stocks and build a weekly dividend income as per this calendar, but we have made no changes to this goal last week:
 

Weekly dividends income calendar
 
You can see the entire spreadsheet here.

I feel really good about finishing our ABBV accumulation phase. ABBV is not a cheap stock and it took a long time to get to 100 shares. But now that we are there, I am proud.

 

Market Outlook

 

The stock market broke above its sideways consolidation trade, confirmed the breakout, and now continues going higher. It is in a clear and strong uptrend and as of now, it has no resistance above. So, it can literally move to the moon. The only resistance is priced by the market at $4,400 as expected move since June 18. The more the market moves towards that level, the more hedge funds have to start hedging their positions by buying shares against their short calls, and the more they do so, the more the market melts up. As we get closer to that level, expect faster and stronger moves. And then? After that, either consolidation or retreat.

 
SPX July 03 2021 outlook
 

With current S&P 500 earnings at 194 a share, the intrinsic value of the market is at $4,074 a share. That makes this market overvalued. But we are still recovering from the pandemic and businesses are expected to grow. The earnings forecast for 2022 is at 218 per share and that would make this market’s intrinsic value $4,578 (without Biden’s corporate tax hike). If this market keeps going sideways, the evaluation may catch up with the current price.

 

90% probability of going up

 

Based on the numbers and earnings of the market, the trend momentum shifted to the upside dramatically over the last week. Expect this market to continue going higher unless some black swan event halts it.

 

Investing and trading report in charts

 

Account Net-Liq

 

TW Account Net-Liq week 25

 

Account Stocks holding

 
TW Account holdings week 26
 

Our stock holdings still do not beat the market. However, I expect it to change over time. S&P 500 grew 50.46% since we opened our portfolio while our portfolio grew 17.32% only. On YTD basis, the S&P 500 grew 20.61% and our portfolio 10.33%.
 

Account Growth YTD

 
TW Account holdings Growth YTD
 

I expect our stock holdings to start outperforming the market as they mature. However, these are just our stock holdings. The entire portfolio beats the market by far thanks to monetizing those positions.

Our goal is to grow this account to $1,000,000.00 value in ten years. We are in year two.

 

Investing and Trading Report – Options Monthly Income

 
TW Options Income week 26
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Income week 26
 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 26
 

We are on track to accomplish our dividend income goal, currently, we are at 66.23% of the goal to reach $1,071 of dividend income this year. I also noticed that I was mistakenly comparing our monthly dividend income with the annual dividend income projection on the chart below. So I corrected that chart and moved the annual dividend projection to this chart (above). Now, what you can see, is the received dividends per year (blue), our 2021 goal (red line), and dividend projection based on the existing holdings (magenta line). If we held our current holding for the entire dividend cycle, the projection is the dividends we would have received.

Currently, we accumulated enough shares to receive $3,783.70 in annual dividends if we have held through the entire dividend cycle.
 

TW Received vs Future Dividends week 26

The chart above is the corrected chart comparing the projected MONTHLY dividend income vs received dividend income. And again, the projected dividend income is based on the stock holdings up to date. That is the income we would have received if we have held over the entire dividend cycle.

 

Our account cumulative return

 

The chart below indicates our cumulative adjusted return. It shows how the last week’s selloff shook down our returns but we are recovering along with the market.
 

TW cumulative return wk 25
 

As of today, our account cumulative return is 28.04% (since March 13, 2021).

 

Conclusion of our investing and trading report

 

This week our options trading exceeded our expectations. I hope, the rest of the month will be even better.

We will continue accumulating the dividend growth stocks in our portfolio to reach 100 shares. We will also replenish our cash reserves to bring them back to 25% of our current net-liq value.

We will report our next week’s results next Saturday. Until then, good luck and good trading!





3 responses to “2021 Week 26 investing and trading report”

  1. mark coste says:

    Please remove the link for OPTIONS HUNTING.
    Not looking safe.

  2. chosengadget says:

    Thank you so much for this report

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